Perth developer hit with lengthy ban by corporate watchdog

ASIC has hit high-profile developer Allen Caratti with a lengthy ban after his involvement in a string of failed business ventures.

Perth developer Allen Caratti has been punished by ASIC.

The corporate watchdog has hit high-profile Perth developer Allen Caratti with a lengthy ban after his involvement in a string of failed business ventures.

ASIC on Tuesday said it had disqualified Mr Caratti from managing corporations for a period of four years following the collapse of three land development companies of which he was a director between 2005 and 2017.

ASIC said there had been “significant failures of governance and oversight” by Mr Caratti in the management of companies Mammoth Civil, Whitby Land Company and MNWA.

The watchdog found Mammoth Civil had failed to maintain proper business records and had not lodged an income tax return with the Australian Taxation Office in 2015.

Whitby failed to register for an Australian Business Number or tax file number, to lodge business activity statements between 2011 to 2012 and to lodge income tax returns for the years 2011 to 2013.

Whitby also provided the ATO with inconsistent information on land development costs and failed to report sales of land in one of the company’s developments.

MNWA meanwhile had provided unsupported claims to the ATO for tax deductions for the period 1 July 2009 to 30 June 2012 and failed to maintain proper business records.

ASIC can disqualify a person from managing corporations for a maximum period of five years if within a seven-year period the person was an officer of two or more companies, those companies were wound up or a liquidator concluded they were unable to pay their debts.

ASIC said during its consideration of the matter Mr Caratti provided a signed assurance he would resign his director and secretary positions of the companies.

But, this did not occur and he either “willingly or carelessly made false representations to ASIC”. ASIC found this supported the decision to disqualify Mr Caratti.

ASIC also said Mr Caratti had failed to assist the liquidator of Whitby and failed to tell the liquidator of WNWA the location of the business records of the company.

In deciding to disqualify Mr Caratti, ASIC said it had relied on statutory reports lodged by Robert Kirman of McGrathNicol, who was the registered liquidator appointed for each of the three companies.

Mr Caratti in October applied to the Administrative Appeals Tribunal, now the Administrative Review Tribunal, for a review and stay of ASIC’s decision but earlier this month was refused. The substantive review application of the decision remains ongoing.

The Caratti family were included in the WA Richlist in 2019 with an estimated fortune surpassing half a billion dollars.

The family were described as one of the biggest owners of farming land in the Esperance area and had benefited from a surge in the value of premium properties in the area.

Earlier this year, Mr Caratti lost a bid to overturn a WA Supreme Court ruling he pay an investor money sunk in a collapsed company 14 years ago plus interest.

The investor, Liangzhang Zhou, spent $1.2m subscribing to redeemable preference shares in the firm Parliament Place in a September 2010 investment agreement, with the cash earmarked for developing property in the Perth suburb of Southern River.

Under the deal, Mr Zhou could redeem the shares for their face value plus an amount equal to an annual return of 20 per cent within 13 months of receipt of the cash.

However, Parliament Place did not redeem the preference shares and was eventually placed into liquidation. In November 2022, the Supreme Court of WA found Mr Caratti was liable to pay Mr Zhou $1.5m.

Originally published as Perth developer hit with lengthy ban by corporate watchdog